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Questioning rate of noncash payments
A rate of 0.7 percent merchant discount rate (MDR) is charged in QR code-based transactions to sellers or merchants for regular payments, both On-Us and Off-Us transactions.
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A merchant displays a Quick Response Indonesia Standard (QRIS) on the left compared to a regular QR code on the right. The QRIS's pattern is more complex because it holds more coded data. (JP/Norman Harsono)
I
ndonesia’s payment systems entered a new era following Bank Indonesia’s (BI) implementation of the Indonesian QR Code Standard (QRIS). This noncash payment method based on the QR code applies to all server-based electronic money (e-money) payment applications, electronic wallets (e-wallets) and mobile banking.
Under the QRIS, payment transactions become more efficient, financial inclusion is more quickly achieved, business activities can be more advanced and in the end can encourage economic growth.
The above breakthrough shows that BI is always trying to accommodate recent financial technology developments in Indonesian payment systems. Hence, the QRIS is one of the implementations of the Vision of Indonesia’s Payment System 2025.
However, the adoption of brand-new technology always faces the problem of stakeholder response, especially disruptive innovation technology.
In the context of the QRIS, the most sensitive issue concerns pricing. A rate of 0.7 percent merchant discount rate (MDR) is charged in QR code-based transactions to sellers or merchants for regular payments, both On-Us and Off-Us transactions.
A transaction carried out at an ATM of the card-issuing bank is called an On-Us transaction. A transaction carried out at an ATM of a bank that is different from the card-issuing bank is called an Off-Us transaction.
A rate of 0.7 percent is considered by the noncash payment service providers still to be below the break-even point. The QRIS fee of 0.7 percent is also far more expensive than the MDR debit card fees charged at a rate of only 0.15 percent.
